Oncolytic viruses are designed to eliminate tumors by direct infection and lysis of cancer cells. Recently, we and others have observed that in addition to a direct tumor killing by the virus there is also an indirect cytopathic effect due to vascular collapse associated with a loss of blood flow to the interior of the tumor and infiltration by peripheral Gr1+CD11b+ neutrophils. Furthermore, our preliminary results demonstrated that oncolytic vaccinia virus (OVV) expressing an antagonist of the CXCR4 receptor for CXCL12 chemokine (OVV- CXCR4-A-Fc) was more effective in inhibiting growth of triple-negative (TN) breast carcinomas 4T1 in syngeneic mice compared to the treatment with OVV expressing the enhanced green fluorescence protein (OVV-EGFP). The inhibition of primary and metastatic tumors by OVV-CXCR4-A-Fc was associated with i) an increased expression of interferon regulatory factor-8 (IRF8), a putative determinant of protumorigenic behavior of MDSCs, in tumor-infiltrating granulocytes, ii) reduced percentage of FAP+ cancer associated fibroblasts (CAFs), iii) decreased levels of CXCL12, and iv) collapse of the tumor vasculature. These changes within the tumor microenvironment were either not observed (such as elevated expression of IRF8) or were less pronounced after treatment with OVV-EGFP. The mechanism by which OVV-CXCR4-A-Fc affects interaction between CAFs and MDSCs and expression of IRF8 is unclear. We hypothesize that the enhanced expression of IRF8 in MDSCs and promotion of their differentiation toward type 1 phenotype with antitumorigenic activity is regulated by the CXCL12/CXCR4 ligand/receptor signaling pathway in CAFs. We propose to identify the key events of the CAF/MDSC interaction that regulates expression of IRF8 by analyzing changes in the production of tumor- derived factors (TDFs) in 4T1-bearing syngeneic mice and human breast carcinoma MDA-MB-23 xenografts in SCID mice. The Specific Aims are: 1). We will compare quantitative and qualitative changes in CAFs, myeloid cells, epithelial tumor cells, TDFs, and tumor vasculature induced by OVV-EGFP and OVV-CXCR4-A-Fc treatments. 2). Using IRF8 knockout and IRF8 transgenic mice and autologous AT-3 breast carcinoma cells, we will explore the role of IRF8 in modulation of myeloid differentiation after blocking the CXCL12/CXCR4 ligand/receptor signaling pathway by OVV-CXCR4-A-Fc. 3). Using the established 4T1 breast tumor model for spontaneous lung metastasis, we will compare the reciprocal dynamics in colonization of a metastatic niche in the lungs by IRF8+ MDSCs and mature neutrophils after OVV-CXCR4-A-Fc and OVV-EGFP treatments. We anticipate that understanding the activation of inflammatory cells can be used for enhancing the effectiveness of OV therapeutics for treatment of the highly aggressive tumors.